Financial analyst Patrick Abankwa Baah has suggested that Ghana’s recent positive outlook from Moody’s could significantly enhance investor confidence and attract more foreign direct investment.
His remarks follow Moody’s decision to upgrade Ghana’s outlook from stable to positive, citing reduced liquidity risks, bolstered by fiscal reforms under the $3-billion IMF Extended Credit Facility (ECF) programme.
This development coincides with the third review of the ECF programme, where IMF staff and Ghana reached a new agreement. Moody’s attributed the upgrade to factors such as robust economic growth, improved fiscal management, a stronger financial sector, and a favorable policy environment.
Baah highlighted that the ongoing IMF-backed reforms demonstrate the country’s efforts to overcome economic challenges and stabilize its financial landscape.
‘‘I think that the implication of this positive outlook is far reaching. It is going to increase investor confidence. If the investor confidence is improved, then with time, the fact that Ghana is now in the positive outlook means that, it will now have borrower cost going down because government will now have avenue to raise funds from other sources than the local Treasury Bill Market. It will also lead to improved credit rating for the country’’, Patrick Abankwa Baah said.
In the meantime, the financial analyst has urged the government to maintain its commitment to the IMF bailout programme, emphasizing that the country has not yet fully recovered.
While the positive outlook is a hopeful sign, he stressed the importance of recognizing ongoing challenges and the need for the government to diligently pursue necessary reforms to uphold the progress being made.
Abankwa Baah pointed out that factors such as global economic conditions, fluctuations in commodity prices, and political instability could still pose risks to the observed economic growth.
‘‘Moody’s decision to shift Ghana’s outlook to positive is a testament of the country putting in place efforts to address its economic challenges. I think the continuous implementation of sound policies and ability to still maintain fiscal discipline should help Ghana to move up the ladder eventually in terms of ratings’’, Abankwa Baah noted.
That statement came from financial analyst Patrick Abankwa Baah regarding Moody’s upgrade of Ghana’s outlook to positive, which is expected to enhance investor confidence. He also emphasized the importance of the government maintaining its focus on the IMF programme.